Ppl Corporation · NYSE:PPL
Ppl — EEI Financial Conference 2011
31 slides from Ppl's conference presentation, Nov 7, 2011
Slide 1: EEI Financial Conference
©PPL Corporation 2011 EEI Financial Conference ©PPL Corporation 2011 Orlando, FL November 6 - 9, 2011
Slide 2: Cautionary Statements and Factors That May Affect Future Results
©PPL Corporation 2011 2 Cautionary Statements and Factors That May Affect Future Results Any statements made in this presentation about future operating results or other future events are forward-looking statements under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1
Slide 3: PPL Delivery and Generation Assets
3 PPL Delivery and Generation Assets Exhibit 99.2 United Kingdom delivery territories: WPD (South Wales) WPD (South West) WPD (West Midlands) WPD (East Midlands) United Kingdom delivery territories: Delivery territories: • PPL Electric Utilities • Kentucky Utilities • Louisville Gas and Electric Del
Slide 4: Investment Highlights
©PPL Corporation 2011 4 Investment Highlights Predominantly rate-regulated business mix with significant growth prospects Operations in constructive jurisdictions Approximately two-thirds of regulated capital expenditures earn real-time or near real-time returns ~ 9% compound annual growth in rate b
Slide 5: Real-Time Recovery of Regulated Capex Spending
©PPL Corporation 2011 5 (1) (2) $0.2 $0.2 $0.6 $0.3 $0.6 $0.8 $0.7 $0.5 $0.5 $0.4 Note: $ in billions. (1) Includes capex for WPD Midlands. Figures based on assumed exchange rate of $1.60 / GBP. Real-Time Recovery of Regulated Capex Spending 67% $0.8 69% $1.1 69% $1.1 66% $1.1 65% $1.1 (1) Approxima
Slide 6: Midlands Integration Goal: Improved Performance
©PPL Corporation 2011 6 Midlands Integration Goal: Improved Performance… Safety Network performance Contact center Complaint handling …resulting in cost efficiencies and potential long-term revenue bonuses
Slide 7: Midlands Integration - Actions to Date
©PPL Corporation 2011 7 Midlands Integration - Actions to Date Road shows completed for 3,900 Midlands staff setting out WPD background values and approach to integration - 36 presentations over 9 days Organizational design completed 85% of union staff voted to move to single set of WPD labor contra
Slide 8: Midlands Integration - Improved Safety
©PPL Corporation 2011 8 Midlands Integration - Improved Safety 2010/11 (April to Sep 2010) 2011/12 (April to Sep 2011) Lost Time Accidents 9 1 Non Lost Time Accidents 52 50
Slide 9: Midlands Integration - Improved Network Performance
©PPL Corporation 2011 9 Midlands Integration - Improved Network Performance Target 60: 18 Hour Standard:
Slide 10: Midlands Integration - Improved Network Performance (cont'd)
©PPL Corporation 2011 10 Midlands Integration - Improved Network Performance (cont’d) Customer Minutes Lost: Customer Interruptions:
Slide 11: WPD Performance Rewards Top in Industry
©PPL Corporation 2011 11 WPD Performance Rewards Top in Industry Aggregate Total Award / Penalty ($ in millions) Aggregate as % of DPCR4 Revenue Source: Ofgem data. Note: Figures based on assumed exchange rate of $1.60 / GBP. 11 WPD Performance Rewards Top in Industry WPD Performance Rewards Top in
Slide 12: Significant Synergy Opportunity
©PPL Corporation 2011 12 Significant Synergy Opportunity 100% Synergies retained through end of current rate period (1) ; 47% in following rate period (2) Estimated Annual Pre-Tax Synergies Opex Synergies by Category Note: Figures based on assumed exchange rate of $1.60 / GBP. (1) Ends in March 2015
Slide 13: Kentucky Regulated Environmental Cost Recovery (ECR) Mechanism
©PPL Corporation 2011 13 Kentucky Regulated Environmental Cost Recovery (ECR) Mechanism ECR allows real-time return of and on environmental investment (including CWIP) and recovery of environmental expenses associated with coal-fired generation Total Capital Expenditure Plan - $2.5 Billion LG&E - $1
Slide 14: Pennsylvania Regulated - Transmission
©PPL Corporation 2011 14 Pennsylvania Regulated - Transmission PPL Electric to build Pennsylvania portion of the 150-mile Susquehanna to Roseland, NJ 500 kV transmission line. New Jersey portion of the line to be built by PSEG Already approved by both PA and NJ state utility commissions ROE of 12.93
Slide 15: Pennsylvania Regulated - Distribution
©PPL Corporation 2011 15 Pennsylvania Regulated - Distribution House Bill 1294 - Alternative Ratemaking Bill provides for timely recovery of costs for a broad range of capital projects geared toward improving and maintaining safety and reliability Passed House on Oct. 4 Currently being reviewed by t
Slide 16: Supply Market Fundamentals
©PPL Corporation 2011 16 Supply Market Fundamentals Coal Retirements in PJM 7 - 17 GWs of PJM coal-fired capacity at-risk for retirement by 2019. Most at an average age of 50 years, are under 500 MWs, and have capacity factors around 30% ~ 50% located in western PJM Price Impact Anticipate an increa
Slide 17: Dividend Profile
©PPL Corporation 2011 17 Dividend Profile A significantly more rate-regulated business mix provides strong support for current dividend and a platform for future growth (1) Ongoing EPS based on mid-point of forecast. Annualized dividend based on 3 rd quarter declaration. Actual dividends to be deter
Slide 18: Appendix
©PPL Corporation 2011 18 Appendix
Slide 19: Increased 2011 Earnings from Ongoing Operations Forecast
©PPL Corporation 2011 19 $3.13 $2.75 $/Share (1) Based on mid-point of forecasted earnings range. Note: See appendix for reconciliation of earnings from ongoing operations to reported earnings. (1) $2.55 2010A 2011E Increased 2011 Earnings from Ongoing Operations Forecast
Slide 20: International - Modeling Parameters
©PPL Corporation 2011 20 International - Modeling Parameters 20 International International –– Modeling Parameters Modeling Parameters – – – – – – X = Revenues ( £ ) . Regulated Revenues escalate 5.5% annually plus inflation through end of current price control period plus incentives; Energy related
Slide 21: WPD - Annual Revenue Performance Bonuses
©PPL Corporation 2011 21 WPD - Annual Revenue Performance Bonuses WPD has earned over $100 million in annual performance awards over the past 7-year regulatory period, excluding Central Networks historical performance Annual Revenue Performance Bonuses Annual Revenue Performance Bonuses Annual Reven
Slide 22: Expected Generation and Hedges
©PPL Corporation 2011 22 Capacity revenues are expected to be $430 million, $385 million and $590 million for 2011, 2012 and 2013, respectively. As of September 30, 2011 (1) Represents expected sales of Supply segment based on current business plan assumptions. (2) The 2011 average hedge energy pric
Slide 23: Market Prices
©PPL Corporation 2011 23 Market Prices (1) 24-hour average. (2) NYMEX and TZ6NNY forward gas prices on 9/30/2011. (3) Market Heat Rate = PJM on-peak power price divided by TZ6NNY gas price. 23 Market Prices Market Prices Balance of 2011 2012 2013 $46 $52 $56 $36 $39 $42 $41 $45 $48 $33 $33 $41 $29 $
Slide 24: Supply Hydro Expansion Construction Progress
©PPL Corporation 2011 24 Supply Hydro Expansion Construction Progress Holtwood Hydro Expansion Project (PA) Rainbow Hydro Project (MT)
Slide 25: Regulated Rate Base Growth
©PPL Corporation 2011 25 Regulated Rate Base Growth ($ in billions) (1) Represents capitalization for LKE, as LG&E and KU rate constructs are based on capitalization. Represents Regulatory Asset Value (RAV) for WPD. (2) Includes RAV for WPD Midlands. Figures based on assumed exchange rate of $1.60 /
Slide 26: Capital Expenditures
©PPL Corporation 2011 26 Capital Expenditures ($ in billions) (1) Includes capex for WPD Midlands. Figures based on assumed exchange rate of $1.60 / GBP. (2) Expect approximately 85% to receive timely returns via ECR mechanism based on historical experience. (1) (2) $2.6 $3.7 $4.3 $4.1 $3.7
Slide 27: Debt Maturities
©PPL Corporation 2011 27 Note: As of September 30, 2011 (1) Notes were repaid at maturity in November 2011. (2) Excludes $1.15 billion of junior subordinated notes due 2018 that are a component of PPL’s 2010 Equity Units and may be put back to PPL Capital Funding if the remarketing in 2013 is not su
Slide 28: Liquidity Profile
©PPL Corporation 2011 28 Note: As of September 30, 2011 ● Credit facilities consist of a diverse bank group, with no bank and its affiliates providing an aggregate commitment of more than 9% of the total committed capacity for the domestic facilities and 17% of the total committed capacity for WPD’s
Slide 29: Reconciliation of PPL's Earnings from Ongoing Operations to Reported Earnings
©PPL Corporation 2011 29 Reconciliation of PPL’s Earnings from Ongoing Operations to Reported Earnings 29 Reconciliation of PPL Reconciliation of PPL’’ s Earnings from Ongoings Earnings from Ongoing Operations to Reported Earnings Operations to Reported Earnings (Per Share) High Low 2011 2011 2010 2
Slide 30: Forward-looking statements
©PPL Corporation 2011 30 Statements contained in this presentation, including statements with respect to future earnings, cash flows, financing, regulation and corporate strategy are "forward-looking statements" within the meaning of the federal securities laws. Although PPL Corporation believes tha
Slide 31: Earnings from ongoing operations definition
©PPL Corporation 2011 31 “Earnings from ongoing operations” should not be considered as an alternative to reported earnings, or net income attributable to PPL, which is an indicator of operating performance determined in accordance with generally accepted accounting principles (GAAP). PPL believes t